Voting – Proxy Ballots

Q

I live in a Planned Community in Ohio with an HOA. We recently held our annual meeting and elections for the 3 directors positions. Several proxy votes have been found to have forged signatures. The proxies in question were in the favor of a sitting director and president of the HOA. That director was reelected. He refuses to have a do-over. Is there any recourse for us? Would the forgery of signatures in this case be a Civil or Criminal matter?

A

Thank you for your question.  Elections are an important process for community associations and their members.   The specific procedures required for the election of directors are often found in the bylaws for the Association.  The bylaws will specify all of the requirements for nominations and election, including the ballots and proxies.  In addition, the corporations code for your state will also have requirements that pertain to non-profit corporations which impact the process.  Without looking at all of the specific documents it is difficult to answer a specific questions about potential fraud and the ramifications of any legal procedure.

Your concerns about this election should be first addressed in writing to the board of directors.  If you do not receive a satisfactory response it is recommended that seek you the advice of an attorney in your area, that specializes in community associations.

 


 

Q

1. What percentage of residential HOAs, as opposed vacation/resort HOA’s, allow members to assign proxies to other members?

2. What perscentage of residential HOAs elect members to the Board of Directors and then the Board elects the officers from the Board members as opposed to the HOA Members elelcting the Board officers directly?

– Vern

 

A

Each community association conducts their election based on the requirements contained in the governing documents, generally the bylaws, and state law.  As the laws vary across the country so do the procedures.  Although we do have statistical data that gives us the percentages you have requested, I have referred your question to our Vice President of Government and Public Affairs, Andrew Fortin.  According to Andrew, most states allow members to assign proxies to other members for the election of the Board.  Officers are generally elected solely by the Board at their first meeting.

I hope this is helps clarify the process.

 


 

Q

We recently held our first HOA meeting and voted one new member. The builder is slowing moving out. Neighbors came along with some proxy’s. Are text messages ok to be sent for a vote or a email at the last moment for a vote. We didn’t have a quorum so people started texting. I didn’t because I didn’t think it was allowed. I thought the meeting should be postponed. Help please.

- Linda

A

Your association’s governing documents and state statutes should describe what types and forms of proxies are acceptable. I have never seen a situation in which texted messages are an approved format for a proxy. Most governing documents require the association to temporarily adjourn the meeting while the members in attendance return to the community and solicit proxies from their neighbors on an approved form. Alternatively, the documents may require that the meeting be adjourned and a new notice sent out, starting anew with the collection of proxies or perhaps “holding over” the proxies already submitted.

If state statutes and/or the governing documents (usually the bylaws) do not specify the use and format of proxies, I recommend your board consult with the association’s attorney to develop a policy that addresses this issue.

Sincerely,

Margey


Q

Proxy votes are allowed at Homeowner’s meeting. Is there a limit on the number of proxy votes one individual homeowner can have with multiple proxy votes of absent Homeowner’s at an annual meeting? Also, are proxy votes allowed for Board of Director’s quarterly meetings?

- Ray

A

If the number of proxies assigned to each individual is not limited in the association’s governing documents or state statutes, then each owner may be assigned an unlimited number of proxies. If the board believes that the use of proxies is being abused, it may be able to approve a resolution restricting the number each owner may have. The board should definitely consult with an attorney before issuing such a mandate.

Typically, board members may not use proxies for their meetings unless specifically authorized in the governing documents.

Sincerely,

Margey


Q

Can Proxy ballots be consider as an absentee homeowner’s physical presence to be utilized for purposes of making a quorum at annual Homeowner meeting?

- Ray

A

There’s a big difference between a proxy and an absentee ballot. A proxy enables an owner to assign his vote to someone else because the owner does not intend to attend a meeting. An absentee ballot allows the owner to directly vote in advance for issues that will be discussed at a meeting, similar to an absentee ballot for a municipal election.

With the approval of the association’s legal counsel, if worded correctly, and if not in violation of state statute or the association’s governing documents, proxies and absentee ballots may be used for quorum purposes.

Sincerely,

Margey


A

I am the Secretary of a Condominium Association in Maryland. My question is about voting by email. Any suggestions on an appropriate way to:

Send an issue to vote?

When and how to document that an email vote was made?

Thanks.

- CK

A

To ensure a Maryland-specific response to your question, I reached out to Mr. Bob Elks, President of Select Community Services, an Associa company headquartered in Virginia with offices and managed communities in Maryland. In turn, Mr. Elks asked attorney Raymond B. Via, Jr., with the law firm of Whiteford, Taylor & Preston L. L. P. , for his legal perspective. Here is Mr. Via’s response:

“The purpose of this memorandum is to explain the procedures that must be followed by Maryland condominiums for valid electronic delivery of notice and the electronic transmission of votes or proxies.

Notice

Even if the governing documents require that notice be delivered in writing, Maryland Condominium Act, Section 11-139.1, permits notice of a meeting or information to unit owner to be sent by electronic transmission. “Electronic transmission” is any form of communication not directly involving the physical transmission of paper that creates a record that may be retained, retrieved, and reviewed by the communication’s recipient and may be reproduced directly in paper form by the recipient through an automated process. Maryland Condominium Act, Section 11-101(h).

However, notice by electronic submission is only valid if certain procedures are followed:

The Board of Directors must give the Council of Unit Owners (the “Council”) the authority to provide notice of a meeting or deliver information by electronic transmission;

Any unit owners who will receive notice by electronic transmission must give the Council prior written authorization to provide notice or information electronically; and

An officer or agent of the Council must certify in writing that the Council has provided notice of the meeting or delivered information as authorized by the unit owner.

Maryland Condominium Act, Section 11-139.1. Notice by electronic submission must still be given in the same time period as written notice – no less than ten (10) days and no more than ninety (90) days before a regular or special meeting of the Council. Maryland Condominium Act, Section 11-109(c)(4)(ii). In the event a meeting is adjourned because a quorum is not present, the fifteen (15) day notice of the additional meeting may also be delivered electronically. Maryland Condominium Act, Section 11-109(c)(8)(iii).

If the Council is unable to deliver two consecutive notices to a unit owner and is made aware of the inability to deliver the notices electronically, the delivery by electronic transmission becomes ineffective. However, an inadvertent failure to deliver notice electronically does not invalidate any meeting or action.

The Council, Board of Directors, or agent may respond to a valid request to inspect Condominium records by transmitting the requested documentation electronically. Maryland Condominium Act, Section 11-116(c)(2).

Voting and Proxies

Similarly, electronic submission of votes or proxies is permitted under the Maryland Condominium Act, Section 11-139.2, notwithstanding language in the governing documents to the contrary. The Board of Directors may authorize unit owners to submit a vote or proxy electronically if the electronic transmission contains language verifying that the vote or proxy is authorized by the unit owner or the unit owner’s proxy. Maryland Condominium Act, Section 11-139.2. If the governing documents of the Condominium require voting by secret ballot and anonymity cannot be guaranteed by electronic transmission, electronic voting is still permissible if the unit owners have the option of casting printed ballots anonymously. Maryland Condominium Act, Section 11-139.2. If these procedures are followed, an electronically transmitted vote or proxy may be counted in elections for officers of members of the Board of Directors. Maryland Condominium Act, Section 11-109(c)(12).“

Sincerely,

Margey


Q

Two members of our five-member Board (in CO) were not in attendance at our July quarterly board meeting due to their last-minute vacation plans. We were not able to reschedule the meeting due to other board members’ scheduled vacation plans. They sent in letters to be read to the owner attendees stating that they did not want any discussion or vote on our proposed lighting guidelines, which we had all previously reviewed and made our inputs at a working session. They also provided blanket proxies to another board member to vote on their behalf on any other issues that might arise during the meeting.

Our bylaws state: “At all meetings of the Board, a majority of the Directors shall constitute a quorum for the transaction of business, and the votes of a majority of the Directors present at a meeting at which a quorum is present shall constitute a decision of the Board.” Our governing documents only reference proxies in relationship to the general membership and voting at the annual meeting. The only other provision in our bylaws allows BOD members to attend the meeting by calling in, which they refused. They instead sent in their proxies. Is this legal or ethical? Since we did have a quorum of the BOD present at the meeting (3 out of 5 BOD members), shouldn’t we have been able to transact business as usual? Thank you.

- Penny

A

You’re correct in thinking that your board of directors must comply with your association’s bylaws regarding when and how to conduct meetings. Unless specifically allowed in the bylaws, proxies are typically not allowed for board members, and the actions voted on by the directors present, either in person or by telephone as authorized in the bylaws, were legal and enforceable.

Sincerely,

Margey


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